The double problem of financing video games

Financing a video game means absorbing a production cycle of one to four years with no initial revenue, while accepting a high risk of commercial failure. Traditional banks, used to tangible assets, prove unable to assess this sector: no physical collateral to seize, no early turnover and intellectual property that is complex to value.

In Africa, this structural challenge is compounded by a nascent ecosystem. Creators lack local options: no bank supports the industry and specialised venture capital is absent. An African studio must therefore be agile, combining general local levers with international opportunities that assess only the quality of the game, with no geographical criteria.

1. The realities on the ground in Africa: bootstrapping and repurposed grants

To survive, most African studios rely on bootstrapping and B2B subcontracting (educational apps, commissioned development). While this approach preserves capital, as with Digital Mania in Tunisia or Funsoft in Morocco (which self-funded its virtual reality game Rangi to the tune of one million dirhams), it drastically slows down original creation, as the team has to split its time to make a living.

In the absence of funding windows dedicated to the cultural industries, creators have to cleverly “repurpose” general digital support funds:

• The AFD seed fund: with 15 million euros across 45 countries, it supports start-ups with up to €300,000 through local partners.
• Digital Africa: awards non-dilutive grants of up to €50,000 (from ideation to MVP).
• Networks and incubators: organisations such as Teranga Capital (Senegal), the MEST Africa incubator, or the Cameroon Angels Network and Ivoire Business Angels networks fund projects at an early stage, although none of them has an investment thesis specifically focused on gaming.

2. Comparative analysis: France and Europe versus French-speaking Africa

It is at the structural level that the gap between the two ecosystems is deepest.

Grants and sector-specific funding. France and Europe have a highly protective public ecosystem. The Video Game Support Fund (FAJV), managed by the CNC (the French national centre for cinema and the moving image), funds writing, pre-development and production, while requiring the studio to retain its intellectual property rights. On top of this come powerful regional grants (up to €150,000 in Île-de-France) and a very attractive video game tax credit (CIJV). In Africa, these sector-specific public funding windows do not exist. Studios have to make huge efforts to explain their projects in order to make them eligible for general support funds.

The banking sector. In Europe, banks, while cautious, rely on public guarantee mechanisms, such as those of Bpifrance, to cover part of their risk, and have bankers trained in intangible business models. In Africa, access is completely closed. Interest rates are prohibitive, and local bankers’ lack of sector expertise blocks any attempt to borrow without physical collateral (land, buildings).

Venture capital and business angels. Europe has seasoned business angel networks and venture capital funds specialised in video games. In Africa, specialised venture capital does not exist. Moreover, equity financing in French-speaking Africa fell by 31% in 2024 to 229 million dollars (Partech report). Investors there now demand drastic metrics, hardly compatible with the long cycles of a role-playing game (RPG) or a simulation: a specific problem solved, a measurable acquisition cost and quick profitability.

Crowdfunding. In the West, the reward-based model (Kickstarter, Ulule) has reached maturity and is an integral part of market validation. In Africa, the culture of online giving is less established. The model relies instead on equity crowdfunding, massively targeting the diaspora, as shown by the Cameroonian studio Kiro’o Games, which raised €183,000 for its title Aurion.

3. International levers and the role of publishers

Given local limitations, international opportunities are the most realistic lever for African studios, since they disregard geography.

• Epic MegaGrants: this programme offers non-dilutive grants (with no equity stake or royalties) of 5,000 to 75,000 dollars (up to 150,000 dollars for exceptional projects) to creators using Unreal Engine. In 2026, the two application windows run from 12 January to 20 March (cycle 1) and from 29 June to 4 September (cycle 2). A playable prototype is essential.
• Publishers: a publishing agreement makes it possible to obtain a financial advance on future royalties, combined with global marketing, distribution and quality assurance (QA). It is the most concrete way in to target the global market, provided young studios know how to negotiate firmly to retain their intellectual property.

4. Mistakes to avoid and a realistic roadmap

To succeed in raising funds, a studio must avoid several pitfalls: selling “Africa” as a vague global market instead of costing its plan country by country; neglecting accounting transparency (the first sticking point for a foreign partner); managing with speculative cash flow based on promises of grants; and underestimating international processing times (often 6 to 12 months).

The most effective strategic sequence, observed among fast-growing players such as Kweni Studio, is as follows:

1. Secure day-to-day operations in the first months through bootstrapping and subcontracting.
2. Build a solid, attractive and technically flawless playable prototype.
3. Obtain international grants without equity stakes (such as Epic MegaGrants) to fund iteration.
4. Launch equity crowdfunding with the diaspora or sign a publishing deal to finance final production and launch marketing.
5. Only seek venture capital at a late stage, if the business model (for example mobile free-to-play) justifies dilution.

Conclusion

Ultimately, financing a video game studio in our ecosystem is neither a matter of chance nor of mere creative fervour: it is a strategic exercise that requires pragmatism and rigour. The key lies in an incremental approach, where each step taken, from initial resilience through bootstrapping to validation with an undeniable prototype, serves as a lever to unlock the next level of funding.

By avoiding the mirage of premature fundraising, rigorously structuring its accounts and prioritising non-dilutive funding, a studio gives itself the means to preserve its independence and vision. More than just a cultural product, the project then becomes a structured business that reassures international partners, capable of turning the immense potential of the video game industry into tangible and lasting commercial success.

References and sources

Grant programmes and international funding

• Epic MegaGrants: grants for creators using Unreal Engine
• Kiro’o Rebuntu: support and lessons learned on equity crowdfunding in Africa

Market data and financial reports

• Partech Africa: annual report on African fundraising
• French Development Agency (AFD): funding and support for entrepreneurship
• Digital Africa: non-dilutive grants for sub-Saharan African start-ups

Support organisations and regional investors

• Teranga Capital: impact fund for high-potential small businesses
• MEST Africa: pan-African incubator and technology training programme
• Ivoire Business Angels: network of investors in Côte d’Ivoire

Regulatory ecosystem and public support (France)

• CNC: framework and terms of the Video Game Support Fund (FAJV)
• Île-de-France Region: regional grants for the cultural industries
• Bpifrance: bank guarantees and co-financing of innovation

YAO Baba Ange EmmanuelFounder of Kweni Studio

https://lexludica.com/en/articles/double-problem-financing-video-games